To Hear More Ads, Press One
May 22 2000
Imagine this: you're in your car, it's rush hour, and you can't wait for the next radio traffic report to decide which route to take to avoid a jam. If you could jump on the Internet, you could find the information in a flash. But most cars still lack Web access.
That's changing. Via a new breed of services called voice portals, you can access the Web by talking on your phone. The services are free, although they require callers to listen to ads; while the portal's browser is downloading the latest traffic information, you may hear a 15-second ad. Alternatively, the stock quote or movie review you've requested may be "brought to you by American Express ."
Voice portal enthusiasts see the technology as the hottest Internet innovation since Web-based e-mail. Available through a toll-free number from an ordinary phone, these portals offer Web-based information to people without access to a computer. The voice portals offers services in a range of categories: news, weather, sports scores, stock quotes, movie listings and so forth. The portals use speech-recognition technology to process spoken words into text commands, retrieve data from the Net and then read it back to the caller. A dozen portals have launched pilot versions, with new entrants jumping into the mix every day, each offering variations on a similar theme. And almost all are banking on advertising as their primary revenue source.
Steve Chambers, marketing VP for SpeechWorks International, a leader in speech-recognition technology, believes the concept could be a boon for the ad industry - targeted, interactive messages delivered on the most ubiquitous device of all, the telephone. Based on Web browser technology, the ads on most of these services usually invite the caller to interact by having them ask for more detailed information on a special offer, or connect directly to a merchant to purchase something.
Whether consumers will be willing to put up with this kind of advertising remains to be seen. The question is will people be willing to listen to ads over their phones in order to get a free stock quote or traffic report?
"The compelling argument for the portals is ubiquitous [Internet] access, and that's about speed," says John Dalton, an analyst with Forrester Research . "You are asking for trouble to interrupt that with an ad."
The truth is that no one knows exactly how - or how well - this new medium will work. Among the handful of services currently running, business models are still in flux and the types of ad offerings vary from week to week. None of the portals would provide revenue data - to date, it is no doubt miniscule. But anticipation is keen. The Kelsey Group, a Princeton, N.J.-based research firm, recently estimated that in 2005 voice-portal services will generate $5.4 billion in revenues from ads and transaction fees.
"You are looking at a market that needs to pay attention to how to make money," says Chambers. "There are 30 people offering stocks and weather. It's a different way to think for voice vs. visual ads."
For the voice portals, one obvious fact is that people hear information differently than they read it. These aural ads are neither traditional, passive-listener audio spots nor scanable visual displays. Another critical difference is that callers hungry for information are a captive audience, whereas Web surfers have the option to ignore the blinking banner ads.
"You can't do ads the same way [as clickthrough banners] when it's a forced listen," says Jeff Snyder, a senior analyst with Dataquest. "You are on the phone, and there is no way out. The 'piss-off' factor is going to be very high."